...The Bottom line is, One very good airline, Piedmont, was ruined by takeover by a very stupidly run, pro-union, high-cost, airline...... Not a fan of USEless air, Bryant Petitt Cumming, GA --- Allan9 <exatc@xxxxxxxxxx> wrote: > In a study sponsored by the National Bureau of > Economic Research, University > of Rochester professor Stacey Kole and I trace the > destruction of > shareholder value in the US Air-Piedmont deal - and > in airline mergers more > generally -- to problems with integrating work > forces. In the US Air- case, > large differences existed in the pay scales and work > rules of the two > carriers. Piedmont, for example, used smaller crews > of flight attendants > than US Air, lowering its labor costs. Piedmont also > allowed clerks to > direct planes on the tarmac, while US Air used > costly unionized mechanics. > Overall labor costs represented only 32% of > operating expenses at Piedmont, > but 41% at US Air. > > ----- Original Message ----- > From: "Nick Laflamme" <dplaflamme@xxxxxxxxxxxxx> > To: <AIRLINE@xxxxxxxxxxxxxxxxx> > Sent: Friday, March 21, 2003 11:30 AM > Subject: Re: Re-regulate Again (John Kurtzke) > > > > I'm not John, but.... > > > > The classic argument would be the mergers reduced > competition drastically > > in too many markets. I can see this argument in > the cases of Republic & > > Northwest (upper Midwest) and Piedmont & US Air > (eastern Rustbelt). I > don't > > know how much Delta and Western overlapped before > their merger, though. > > > > Clay asked whether the US government let major > airlines such as AA, UA, > and > > US fail. I think it might -- but local and state > governments might try to > > keep those airlines flying. > > > > For example, Pennsylvania, Pittsburgh, and > Philadelphia all have a lot to > > lose if US goes under. Not that the Commonwealth > of Pennsylvania is flush > > with cash, but can the state afford to let US go > under? Similarly, Chicago > > and the state of Illinois would get incredibly > nervous if both AA and UA > > were close to shutting down; suddenly ORD is close > to a ghost town. DFW > > without AA? SFO without UA? DEN without UA? There > would huge economic > > impacts to the O&D traffic to each of the > mega-hubs, and consequently to > > the local economies. jetBlue, Southwest, Frontier > and AirTran couldn't > > expand quickly enough to fill the voids, no matter > how much they might > want > > to. > > > > Nick > > > > At 11:03 AM 3/21/2003 -0500, Allan9 wrote: > > >John, > > >Why would you say the mergers should not have > been approved? > > >Al > > > > > >>From: John Kurtzke [mailto:kurtzke@xxxxxx] > > >>Sent: Thursday, March 20, 2003 2:25 PM > > >>Subject: Re: Re-regulate Again > > >> > > >>Department of Justice allowed some mergers to go > forward which should > > >>have been stopped. (Republic-Northwest, > Delta-Western, US Air-Piedmont, > > >>to name a few.) > > >> > > >>john kurtzke > > >> > > >>kurtzke@xxxxxx > > __________________________________________________ Do you Yahoo!? Yahoo! Platinum - Watch CBS' NCAA March Madness, live on your desktop! http://platinum.yahoo.com